BA 222 Financial Management

Lecture Hours: 4
Credits: 4

Explores principles of planning, acquiring, and using funds in an organization. Includes investment analysis, budgeting, ratio analysis, capital investments (using present value and internal rate of return), cost of capital, cash and credit management.

Recommended: Placement into WR 121Z; and completion of BA 211Z and MTH 070 or higher. (With a grade of C or better.)

Student Learning Outcomes:

Describe the function of financial management and how financial principles can lead to stockholder wealth maximization.
Calculate and analyze balance sheets and income statement ratios, and compare findings to industry averages for a particular business.
Use sales forecasts to calculate future assets and cash flow needs.
Describe the principles of an effective working capital management program for inventory, accounts receivable, cash and marketable securities.
List various sources of funds for a business. Assess the advantages and disadvantages of each source and the impact of debt or equity on long-range profitability.
Evaluate stock, bond and capital investments, considering the time value of money and risk.
Calculate the weighted cost of capital for an enterprise.

Content Outline

Theories, Concepts, and Tools of Finance
- Overview of financial management
- Financial statements
- Time value of money
- Interest rates
Pricing Assets and the Risk - Return Relationship
- Bonds and bond valuation
- Stocks and stock valuation
- Risk and return
Decision Models and the Cost of Capital
- Capital budgeting decision models
- Incremental cash flow
- Cost of capital
Financial Planning and Evaluating Performance
- Forecasting and short-term financial planning
- Working capital management-cash and inventory management
- Financial ratios and firm performance
Capital Issues and International Finance
- Raising capital-the business life cycle and how financial markets work
- Capital structure
- Stock splits, dividends, and dividend policy
- International finance